JetBlue Airline LOW COST LEADERSHIP MODEL OPERATIONS - Low-cost leader because of full planes, hedging of fuel, pilot training, and maintenance costs - 100% ticket-less reservations - Agents work from home at a lower rate than other airlines - Pilots paid less because there is no seniority standing - Only offer snacks instead of meals, which helps to keep costs down SALES & MARKETING - True blue frequent flyer program - Satellite televisions free in every seat on the plane - Strong word-of-mouth from previous passengers - Several marketing awards noticing their hip and humorous advertising, 2002 & 2003 - First to book flights online, technology SERVICE - Self-service kiosks for those passengers who are in a hurry - Agents who walk around and help guests check-in, portable devices - Flights are never over-booked, also all passengers are assigned a seat - Pilots will load baggage to ensure on time departures - Leg room has been extended to 34”, from the industry standard 31” JetBlue has tried to position their company in the airline business as a low-cost leader that provides quality service. The problem with this type of position in the airline business is that although there are only a few substitutes, they are very strong. Many different new airlines have attempted to enter the market, such as People Express Airline, who in the early 1980’s attempted the same strategy as JetBlue and failed. JetBlue has been able to fight off rivalry from fellow competitors since they were incorporated in 2000. JetBlue has an economy of scale for cost on a seat per mile basis, even surpassing Southwest airlines.
The A380 made its first commercial flight in 2007. Capable of flying over 8000 nautical miles without refuelling, the A380 would be ideal for long-haul passengers and freight applications. By 2009, A380 production was several years behind its contracted delivery schedule and some airlines cancelled their orders. The survival and future success of Airbus, including the employment of 52,000 people at 16 sites in France, Germany, UK and Spain, depended critically on A380 meeting its sales targets over the medium and longer term. Airbus and Boeing focus on medium and long-haul jet aircraft with 100+ seats.
Has Southwest done a better job than competitors of meeting the needs of these air travelers? In what ways? Some values that airline travelers seek are leisure of arriving to their new destination, flexibility, being efficient, and being comfortable all for a fair and inexpensive price. Traditionally, Southwest was inexpensive and flexible because of their low costs and the mentality of just getting travelers from point A to point B. The remodeling of the airline has created a more pleasant atmosphere for the customers.
As of August 2012, Southwest Airlines operates scheduled service to 77 destinations in 40 states. Southwest airlines started with one simple notion: If you get your passengers to their destinations when they want to get there, on time, at the lowest possible fares, and make darn sure they have a good time doing it, people will fly your airline. The Mission of airlines is to “is the dedication to the highest quality of Customer Service delivered with the sense of warmth, friendliness, individual pride and Company Spirit. 7P’s of Marketing Mix 1) PRODUCT-Southwest Airlines is carrier for passengers,travelling to different places. 2) PRICE- Southwest Airlines is known for its low cost offerings.
The cheapest way to travel around the world. Write now Article Tools by James Johnson The cheapest way to travel around the world is to get paid for traveling around the world, and there are several ways to do that. To start with, there are always airline companies looking for employees will to travel. If you have the right qualifications and can pass their entrance requirements, you can get a job that requires you to travel. Grant you there are few airlines that go all the way around the globe, but they will usually have exchange programs with sister airlines and you can go any where.
At the same time, the company continues to focus on keeping its costs low in order to continue to offer the low fares that its customers have come to expect while at the same time upgrading the services and amenities now demanded by many customers. This includes offering live seatback television, pay-per-view movies, more legroom, Web check-in, and Air Miles reward
[pic] Colorado Technical University Southwest Airlines: Porter’s Five Forces Term Project - Final Professor Hanji Wu Submitted in Partial Fulfillment of the Requirements for ECON 616 Applied Managerial Economics By Larry Rodgers, Brent Packard, Leanne Marks, James Ladwig Colorado Springs, Colorado September 2012 Southwest Airlines: Porter’s Five Forces Analysis Southwest Airlines continues to show their strength in this tough industry. With the company’s main focus in keeping costs down, they are in a much better position than the rest of the airline industry in continuing to make profits during this current recession with customers being careful with their money. In fact, while most airlines strongly compete for their fair share of the market which has an impact on their ability to make a profit, Southwest’s focus has been on discovering new ways of increasing their profit. (Bundgaard, et al, 2006) Rivalry Among Existing Firms The threat of rivalry is high. Price competition has been the primary focus of the rivalry among airline companies.
Mature industry life cycle. The Bargaining Power of Buyers: Medium to High - Internet gives the power to the customers to search for the low fares. - Leisure travelers who are not sensitive with the price and most of them are loyalty to the particular industry that offer the best service and offer the best flying experience. - There are many airlines in the market that offers the same flying experience in the low-price. Bargaining Power of Suppliers: High - Boeing and Airbus are the only two suppliers of
From what can see in the case Long Ridge Gliding Club is offering the services at cheap and reasonable prices. Dependability: Dependability is another important factor. The casual flyers have lot of faith on the clubs they receive a dependable service. On the other hand the members don’t get a flight on some days and just have to help the casual flyers. Flexibility: Flexibility is also very important.
By using a framework by (Porter 1980) we can illustrate the compatibility of such a strategy in the existing aviation industry Potential Entrants Despite the high volume of new entrants during the period of easyjet’s inception, only a minority were actually able to survive. This was mainly due to the low usage of low cost air travel by customers as they were still unwilling to transition into the form of air travel. In short, air travellers still preferred the old system which involved having inflight service as well as benefits that would be derived if a person was travelling long distances. Buyers As easyJet offered flights at prices, customers had little to worry about as they were paying amounts far lower than what was required on normal carriers. Additionally, due to the limited competition as well as its ability to keep prices low, easyJet was able to successfully offer stable prices to its customers while ensuring sustainable levels of profitability.